Move expands distributor business model in
South America
NIKE, Inc. (NYSE: NKE) today announced it is transitioning its
Nike Brand business in Brazil, Argentina, Chile and Uruguay to
strategic distributor partnerships, enabling a more profitable,
capital efficient and value accretive business model. This move
demonstrates Nike’s ongoing approach to optimize country operating
models across its global portfolio, with sharpened focus and
investment against its biggest growth opportunities through the
Consumer Direct Offense.*
Nike remains firmly committed to serving consumers in these
countries with the best of NIKE product innovation, services and
experiences, while leveraging these partnerships to foster
sustainable, profitable growth.*
“As Nike continues to successfully implement the Consumer Direct
Offense we are dedicated to serving consumers more personally and
investing against the company’s long-term growth opportunities,”
said Elliott Hill, NIKE, Inc. President, Consumer and Marketplace.
“Nike manages successful distribution businesses around the world
and expanding this model in the rest of South America will help
drive sustainable, profitable growth. Our partners are committed to
serving local consumers and elevating retail and digital
experiences and share Nike’s values and commitment to
employees.”*
Nike’s relationship with and commitment to its athletes, clubs
and federations in these countries will remain unchanged.*
When the transition is complete Grupo Axo will acquire Nike’s
operations in Argentina, Chile and Uruguay, and Grupo SBF S.A.,
(B3: CNTO3), through its wholly owned subsidiary, will become the
owner of substantially all of Nike’s operations in Brazil.*
Grupo Axo is a leading strategic multichannel operator and
distributor with exclusive distribution rights for more than 30
well-recognized brands in Mexico and Chile. Grupo Axo brings more
than 25 years of experience as a premium brand steward and also has
an existing partnership with NIKE in Mexico operating five NIKE
stores. Grupo SBF owns the brand "Centauro" and operates the
largest sporting goods retailer in Brazil and across Latin America,
operating 209 stores with strong omni-channel capabilities.
Both Grupo Axo and Grupo SBF have proven management teams who
are committed to a well-coordinated business transition, with the
aim of completing the transactions by mid-2020. Grupo Axo’s
transaction is subject to local government approval and Grupo SBF’s
transaction is subject to Brazil Antitrust Authority
approvals.*
As a result of the transactions, during the third quarter of
fiscal 2020, NIKE will classify the assets and liabilities of the
entities to be sold as held for sale on the Consolidated Balance
Sheet and will recognize a one-time, non-recurring charge related
to foreign exchange of approximately $425 million. This charge
primarily reflects the anticipated release of associated non-cash
cumulative foreign currency translation losses and could fluctuate
due to changes in exchange rates up to the date of close.*
About NIKE, Inc.
NIKE, Inc., based near Beaverton, Oregon, is the world’s leading
designer, marketer and distributor of authentic athletic footwear,
apparel, equipment and accessories for a wide variety of sports and
fitness activities. Converse, a wholly-owned NIKE, Inc. subsidiary
brand, designs, markets and distributes athletic lifestyle
footwear, apparel and accessories. For more information, NIKE,
Inc.’s earnings releases and other financial information are
available on the Internet at http://investors.nike.com. Individuals
can also visit http://news.nike.com and follow @NIKE.
About Grupo Axo
Grupo Axo is a Latin American premier partner to global fashion
brands. Founded in Mexico in 1994, Grupo Axo leverages more than 25
years of experience in brand stewardship across the retail,
wholesale, and e-commerce sectors to serve as a multichannel
operator and distributor for its leading global client base,
including Abercrombie & Fitch, Bath & Body Works, Brooks
Brothers, Brunello Cucinelli, Calvin Klein, Chaps, Coach, Crate and
Barrel, Guess, Hollister, IZOD, Kate Spade New York, Laces, LOFT,
Lust, NIKE, PVH Heritage Brands, Rapsodia, Speedo, TAF, Tommy
Hilfiger, TrueKids, Victoria´s Secret, and Warner's. Grupo Axo
operates nearly 5,000 corners in department stores and nearly 800
retail stores and shop-in-shops across Latin America. The company
also owns and operates Promoda, a leading Mexican off-price
retailer, and Privalia, an off-price multibrand e-commerce
retailer, as well as Reduced, Rewind, and Urban Store, additional
off-price store concepts.
About Grupo SBF
With 38 years in the market, Grupo SBF is a publicly traded
corporation in Brazil (B3: CNTO3) and owner of the brand
"Centauro", the largest omnichannel retailer of sporting goods in
Latin America. Centauro has 200+ stores in more than 20 states in
Brazil, as well as an e-commerce operation (www.centauro.com.br)
and exclusive app. Centauro offers personalized services and
experiences for each consumer profile, assisting in the purchasing
process and democratizing sports practice in the country. Under an
omnichannel model, consumers decide when, where, and how to try,
buy, and receive their products. Based in Sao Paulo, Grupo SBF has
6,000+ employees.
* The marked paragraphs contain forward-looking statements that
involve risks and uncertainties that could cause actual results to
differ materially. These risks and uncertainties include, among
others, risks and uncertainties relating to NIKE’s ability to
complete a successful transition of its business model, and those
detailed from time to time in reports filed by NIKE with the U.S.
Securities and Exchange Commission (SEC), including Forms 8-K, 10-Q
and 10-K.
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version on businesswire.com: https://www.businesswire.com/news/home/20200206005330/en/
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Media Contact: Mark Rhodes (503)
532-8877
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